Stock plans - employee stock purchase (423)

10 Ways Stock Compensation Can Make You Happier"[1] Wealth creation ... [2] A sense of anticipation ... [3] A feeling of being special ... [4] ESPP participation and discount ... [5] Control over when you receive income and pay taxes ... [6] Donations and gifts of company stock ... [7] Being an owner in your company ... [8] New friends ... [9] Feelings of financial security ... [10] Mindfulness and meaningfulness." (myStockOptions.com)

Employee Stock Plans: 2016 Year-End International Reporting Requirements"This White Paper highlights some of the principal calendar and year-end reporting requirements for employee stock plans that U.S. companies most commonly encounter when offering these programs to their employees in selected jurisdictions worldwide.... A chart summarizing these items [is included]." (Jones Day)

Nearly Half of Employees Used Company Stock to Help with Personal Finances and Increase Financial Well-Being"Forty-eight percent of employees who purchased company stock through an ESPP sold all their shares within two years ... [O]nly six percent of employees that sold all of their shares did so within 10 days of purchasing the shares.... [E]mployees in ESPPs that offer a higher discount are more likely to sell sooner -- almost 40 percent of employees with a 15 percent discount sold all their shares within 90 days, compared to 25 percent of employees in plans with a five percent discount. However, higher discounts contribute to higher employee participation rates." (Fidelity)

[Guidance Overview] Annual ISO and ESPP Information and Reporting Requirements"Participant statements may be provided on Form 3921 (for ISOs) and Form 3922 (for ESPPs) or may be provided using a different format that complies with the substitute form requirements found in IRS Publication 1179.... [C]ompanies with a limited number of transactions will likely use Forms 3921 and/or 3922 (as opposed to substitute statements) since these forms will need to be prepared and submitted to the IRS in any event.... [C]ompanies that provide Form 3921 and/or 3922 to participants (again, as opposed to providing substitute statements) will deliver the form(s) to their participants, along with a cover letter explaining the statement in a manner similar to this statement for ISO transactions and this statement for ESPP transactions." (Orrick)

[Guidance Overview] 2016 Deadlines Approach to Furnish Incentive Stock Option and Employee Stock Purchase Plan Information Statements and Returns"Section 6039 of the Internal Revenue Code requires a corporation to furnish a written statement to any employee or former employee who either [1] exercised an incentive stock option within the meaning of Section 422 of the Code (ISO) during 2015 or [2] during 2015 first transferred legal title to shares acquired under the corporation's employee stock purchase plan.... The corporation must furnish these statements on Forms 3921 and 3922 no later than February 1, 2016.... [C]orporations must [also] file returns with the Internal Revenue Service on Forms 3921 and 3922 no later than February 29, 2016, if filed on paper, or March 31, 2016, if filed electronically." (DLA Piper)

[Guidance Overview] Understanding Form W-2 When It Includes Income from Stock Compensation"The vesting of restricted stock, the share delivery from restricted stock units (RSUs), and the vesting of performance shares all prompt W-2 reporting of the income received. The treatment on the W-2 is essentially the same for all three grant types.... With incentive stock options, the spread value appears on the W-2 only when you make what is technically called a disqualifying disposition, i.e. when you sell or gift the stock before you have met the required holding periods of one year from exercise and two years from grant. In that case, the income appears on the W-2 as compensation income.... If you sold shares from stock compensation or an ESPP last year, you'll need guidance to report the sale proceeds on your tax return." (myStockOptions.com)

Stock Plan Education Shows Improvement But Can Do Better"Many participants are adequately familiar with their stock plans' features but are unsure about how and when to take action with their grants. Slightly more than half of the survey respondents say they have a good sense of the relationship between company stock price and the value of equity compensation, and that is good -- but it also implies that nearly half of the respondents do not understand even this basic concept." (myStockOptions.com)

How Can Companies Help Employees Avoid 401(k) Loans? Offer an Employee Stock Plan"While the positive impact of ESPPs on 401(k) loans was evident in companies of all sizes, the difference was notable in small companies (less than 500 employees), where only 9% of workers took out new 401(k) loans when an ESPP was also available, compared to 14% for employers that only offered a 401(k). The outstanding loan rate at small companies was also significantly lower, with only 14% of ESPP/401(k) workers having an outstanding 401(k) loan balance, compared with 23% of employees at 401(k)-only companies." (Fidelity Investments)

Glass Lewis Releases 2015 Policy Guidelines"The firm has added an area of focus in its discussion on the say-on-pay analysis: The implementation and effectiveness of the company's executive compensation programs including pay mix and use of performance metrics in determining pay levels ... The firm does not believe one-off awards are generally in shareholders' best interest ... Glass Lewis is generally in favor of ESPPs and in most cases will support plans up to a purchase limit of $25,000 per employee per year[.]" (Steven Hall & Partners)

Navigating Company Stock Regs with 10b5-1 Executive Trading Plans: Best Practices (PDF)"Competitive equity compensation is essential for companies looking to attract, reward and retain top executives. To ensure executives' interests are aligned with the shareholders', packages frequently include complex performance awards. Maximizing the value of those equity awards plays a critical role in executives' ability to build wealth and achieve their financial goals. But managing equity programs can be complicated for employers and executives ... [M]ore than 70% of companies cited compliance factors as the biggest challenge in offering equity awards." (Bank of America Merrill Lynch)

[Guidance Overview] IRS Rev. Rul. 2014-9 Offers Rollover Due Diligence Safe Harbor (PDF)"Although the requirement to offer a rollover does not require transferring funds to defined benefit plans, such plans are not precluded from accepting rollovers, as IRS clarified in its regulations. Indeed, recent guidance from IRS and PBGC affirms the ability to make such rollovers and explains how various qualification and benefit guarantee rules operate for them." (Buck Consultants)

Deadlines Approaching for Employer Return Requirements for ISOs and Employee Stock Purchase Plans"A corporation (including private and public corporations) may be subject to penalties if it fails to furnish the applicable form in a timely manner, fails to include all the required information, or includes incorrect information in the form. The corporation has an obligation to file the applicable form with the IRS and distribute the applicable form to the relevant employee and will be liable for penalties with respect to each failure to file or provide the form." (Proskauer Rose LLP)

Annual ISO and Employee Stock Purchase Plan Information and Reporting Requirements"Participant information statements may either be delivered or mailed to the participant's last known address or, if the participant has given his or her consent to receive the statement electronically, provided in electronic format. The consent to receive the statement electronically must be made in a way that demonstrates that the participant can access the statement in the electronic format in which the statement will be provided." (Orrick)

Incentive Stock Options and Employee Stock Purchase Plans: IRS Information Statements and Information Returns Under Section 6039"[E]very corporation that in 2013 records ... the first transfer by an employee or former employee of stock acquired by such employee under an employee stock purchase plan (meaning a plan that is established under Section 423 of the Code, if the purchase price is either less than one hundred percent of the value of the stock on the grant date or is not fixed or determinable on the grant date) must, on or before January 31, 2014, furnish to the employee (or former employee) transferring the stock a written statement containing the information contained on Form 3922." (Cooley LLP)

2013 Executive Stock Ownership Guidelines Report (PDF)"The prevalence of Fortune 100 companies with publicly disclosed executive stock ownership policies increased from 86.3% in 2011 to 89.4% in 2012.... Between 2010 and 2012, the number of companies that used both ownership guidelines and holding requirements as their share retention method increased by 6.0%.... Ownership guidelines that define ownership targets as a multiple of base salary are the most prevalent guideline design.... Among companies with ownership guidelines, only 11.4% include options in determining ownership guideline compliance, compared with 43.0% that explicitly exclude options." (Frederic W. Cook & Co., Inc.)

Annual Reminder: Do You Need to Seek Shareholder Approval of your Stock Incentive Plan in 2014?"[U]nder Code Section 162(m), if the Compensation Committee has the authority to change performance goal targets under the Corporation's stock incentive plan from year to year after shareholder approval of the goals, then the material terms of the performance goal must be disclosed to and reapproved by shareholders every five years.... ESPPs do not need to be reapproved by shareholders every five years for Code Section 162(m) purposes, but they can run out of authorized and registered shares." (Winston & Strawn LLP)

Employees Love Equity Awards But Corporate Stock Plan Education Could Be Better"[A]significant majority of the participants (65%) either have skilled professional or technical roles or work in middle or low-level management.... One interesting line of inquiry gauged the perceived value of stock plans to that of other benefits, especially 401(k) plans. In this comparison, every grant type [but one] proved to be more popular than other company benefits[.]" (myStockOptions.com)

[Guidance Overview] Annual Proxy Considerations in Executive Compensation (PDF)"Preparing to file of an annual proxy statement raises many questions for HR teams, executives, and directors, particularly compensation committee members. As a concise summary, this chart addresses some of the more common and significant questions raised in this process for a larger NYSE- or NASDAQ-listed company." (Steven Hall & Partners)

Accounting for Stock Compensation Under FASB ASC Topic 718 (PDF)"[FASB ASC] Topic 718 creates a more 'level playing field' for equity incentive design that is expected to result in the increased prevalence of full-value and performance-vesting awards, and a corresponding decline in plain-vanilla, tax qualified, and reload stock options, and employee stock purchase plans. This paper summarizes the most pertinent provisions of accounting for stock compensation under Topic 718 and other related FASB and [SEC] Topics." (Frederic W. Cook & Co., Inc.)

New Survey and Research Show the Persistence and Importance of Employee Stock Purchase Plans"[O]ver half of the surveyed companies (51%) plan to modify their ESPPs in the next few years, and that 31% will make their plans more attractive for participants by, for example, increasing the purchase-price discount or adding a lookback provision.... [A]mong the surveyed ESPP companies, the percentage with a 15% discount on the purchase price fell from 87% in 2004 to 71% in 2011, while the percentage with lookbacks dropped from 82% in 2004 to 62% in 2011." (myStockOptions.com)

Job-Based Health Coverage and the ACA: Why the Law Won't Cause Employers to Drop Coverage (PDF)"Ninety-eight percent of businesses with 200 or more workers and 94 percent of businesses with 50 to 199 workers offered insurance to their employees in 2012. Employers have overwhelmingly said that they are unlikely to change their policy of offering coverage for their employees under the [ACA]. A recent study found that 82 percent of employers with 100 to 199 workers and 95 percent of employers with 1,000 to 2,499 workers do not anticipate dropping health insurance in the next one to three years." (Families USA)

January 31 Deadline Nears for New IRS Form 3921 on 2012 ISO and ESPP Purchases"[E]mployers must report incentive stock option (ISO) and employee stock purchase plan (ESPP) purchases for 2012 by January 31, 2013. This was a new requirement for 2010 purchases, and may have caught some employers by surprise since the IRS had delayed implementation for many years previously. Hopefully by now employers have worked the forms into their January payroll reporting routines." (Holland & Hart)

IRS Contends Altera Corp. Wrongly Booked Employee Stock-Based Compensation Attributable to Offshore Unit"The IRS, seeking $27 million in tax payments, contends that from 2004 through 2007 Altera wrongly booked expenses for employee stock-based compensation in the United States where the expenses were tax deductible, according to court records. The agency says Altera should split its employee costs between its U.S. parent and its Cayman Islands unit. Under this treatment, Altera would lose the U.S. tax deductibility of employee costs allocated to the Caymans." (Employee Benefit News)

Employee Ownership Update for April 2, 2012NCEO Executive Director Loren Rodgers discusses new initiatives from the Mondragon Cooperative Corporation, the Secretary of Labor"s comments on re-proposing the DOL's fiduciary rule, UK proposals on options and employee ownership, Deloitte's global share plan survey, low awareness of company facts among U.S. workers, and new employee ownership fellowships at Rutgers. (National Center for Employee Ownership)

The New ESOP Executive Compensation and Private Company Equity Compensation SurveysFor ESOP companies and private companies with equity plans, relevant, affordable compensation data is often difficult to find, and it may be available only for particular industries. Such industry surveys may not address the unique issues that employee ownership companies face. The NCEO 2011 surveys of executive compensation in ESOP companies and of equity compensation in private companies fill this gap. This issue brief summarizes the results, including illustrative graphs and tables. (National Center for Employee Ownership)

New Edition of the Stock Options BookThe NCEO has just released the 13th edition of The Stock Options Book. This detailed reference has been fully updated throughout and covers the latest developments in equity compensation, including the Dodd-Frank Act and Section 6039 reporting. (National Center for Employee Ownership (NCEO))

New Edition of Selected Issues in Equity CompensationThe NCEO has just released the ninth edition of Selected Issues in Equity Compensation, which discusses issues such as securities laws, IPOs, handing death and divorce, and more. The book has been revised for 2012 and features a new, updated chapter on repricing underwater options. (National Center for Employee Ownership (NCEO))

New Edition of Accounting for Equity CompensationThe NCEO has just released the ninth edition of Accounting for Equity Compensation, which has been updated for 2012. Written in plain English for non-accountants, this book is a survival guide for understanding the impact of stock compensation on corporate financial statements. (National Center for Employee Ownership (NCEO))

Should Employees Own More Company Stock or Less?"In the Society for Human Resource Management's Employee Benefits Survey, for instance, only 10% of companies report having stock-purchase plans (which give staffers the opportunity to buy equity in the firm, usually at a significant discount like 15%). That's down almost half from 2008, when 19% of companies did so. And according to human resource consulting firm Aon Hewitt, 36% of employers offer company stock on the investment menu of their retirement plans, down from 47% just two years ago." (Employee Benefit News)

Employee Ownership Update for February 1, 2012NCEO Executive Director Loren Rodgers discusses employee ownership in the 2010 General Social Survey, the continuing importance of ESPPs, Principal's 10 Best Companies for Employee Financial Security, employee ownership and charity, the April Employee Ownership Conference, and a different way of owning 'stock." (National Center for Employee Ownership)

New book on ESPPs (employee stock purchase plans)The Certified Equity Professional Institute just released a new book on employee stock purchase plans (ESPPs) as part of its GPS (guidance, procedures, systems) series, and you can order a copy from the NCEO. (National Center for Employee Ownership (NCEO))

[Guidance Overview] Reminder of ISO and ESPP Reporting Deadlines"This is a reminder to companies issuing incentive stock options and sponsoring employee stock purchase plans about the January 31 deadline to report certain information to participants and the February 28 deadline to file returns with the IRS." (McKenna Long & Aldridge LLP)

The State of Broad-Based Employee Ownership Plans 2012This report details the extent and growth of employee ownership through ESOPs, 401(k) plans, stock options, ESPPs, and other vehicles; summarizes the leading research on employee ownership and corporate performance; and discusses current challenges and prospects. (National Center for Employee Ownership)

Updated List of Employee Ownership Plans in Major Public CompaniesThis list, updated and released in December 2011, shows which of the 900 largest publicly traded companies (the S&P 500 and the S&P mid-cap 400) have various forms of employee ownership, including stock options, stock purchase plans, ESOPs, 401(k) plans, and more. (National Center for Employee Ownership)

Equity Compensation Report for November 2011This is the last of the three introductory issues of the NCEO's new equity compensation newsletter; starting in December, it will be available only to NCEO members. It features an interview with Dan Walter and articles on the NCEO's private company equity compensation survey, determining whether secondary markets are right for your company, and communicating valuation. (National Center for Employee Ownership)

Highlights of NCEO's 2011 Private Company Equity Compensation SurveyEarlier this year, the NCEO conducted a pathbreaking survey of equity compensation practices at hundreds of private companies. This page presents the highlights of the results, from the demographics of the respondents to the distribution of equity at their companies. (National Center for Employee Ownership)

2011 Private Company Equity Compensation Survey ResultsThere are many equity compensation surveys for public companies, but almost none for closely held companies, and these focus just on executive equity in single industries or pre-IPO companies. The NCEO Private Company Equity Survey fills this gap. It is based on 201 completed surveys from private companies with equity plans and 32 responses from service providers in a separate survey designed to corroborate the broader survey results. (National Center for Employee Ownership (NCEO))

Equity Compensation Report for October 2011The October 2011 Equity Compensation Report features articles on valuation issues in closely held companies, best practices for capitalization reporting, an interview with Anne Claire Broughton of the Social Jobs Venture Fund, and more. (National Center for Employee Ownership)

The Equity Compensation ReportThe NCEO has launched a newsletter focusing on equity compensation issues for companies with broad-based plans and closely held companies. The first three issues will be available at no charge to everyone through November. (National Center for Employee Ownership)

Employee Ownership Update for July 15, 2011NCEO Executive Director Loren Rodgers discusses the following: A new study shows equity plans are a large part of employee savings. Other research sheds light on the relation between ESOPs and disclosure practices at public companies. ESOP-owned Reflexite will merge with a German company. The ESOP is a core part of the corporate identity of USA800, a call center company. The Economist published an obituary for Robert Oakeshott. (National Center for Employee Ownership (NCEO))

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